What Small Business Can Learn From Elon Musk


Do you have a product or service that the market doesn't seem to understand or value? Are you met with skepticism? Are you to far ahead of the curve to be mainstream yet?

Take a lesson from the Tesla.

Recently I've been reading about Elon Musk and some of the (seemingly) audacious business decisions he made and is still making. He isn't exactly breaking the rules.

Rather, it seems to me he looks closely for what others are missing because they're stuck in "that's just the way things are."

He sees with new eyes and finds the "aha".

Musk's business plan had three steps. First, to develop a high-end, high-performance sports car, proving that electric vehicles were both cool and feasible. Second, he rolled out a luxury sedan to compete with the likes of BMW and Mercedes. And finally, the third leg of his plan - produce low-cost electric vehicles for the masses.

Here's why I think that's audacious. Most of us, especially in small businesses, go for the seeming safety of numbers. We start with the masses. We create new products and services that are low-cost and often, just kind of 'vanilla'. We believe if we get them into the hands of a lot of people success will be assured.

Here's the problem that Musk saw with this approach.

When something is different the masses are cautious and often, suspicious. They sit back and wait because they aren't risk takers. They want social proof and they want their neighbors to do the proving. Once it becomes mainstream, then they'll jump in.

I've seen this in the evolution of business coaching. Ten years ago, it was a hard sell to convince anyone of the value a coach brought to the table. Very different story today.

Any new idea needs people who think outside of the box and quite frankly, enjoy being different and the status attached to that. They WANT to stand out from the crowd. They set the trends and eventually everyone wants what they have. The trickle down effect.

Musk knows that one of the 'rules' of the automobile business is that high-end luxury options enjoy that trickle down effect. By starting at the top end of the market rather than with economy cars as other manufacturers are doing, he tapped into the way we humans are wired.

Other companies struggled to get this new-fangled idea of electric vehicle accepted by the mass market. And the mass market resists because they aren't the risk-takers. They want a proven concept.

Tesla narrowed his focus to the luxury market by fulfilling the demand for performance and good looks. And oh, by the way, these sleek, sexy cars just happen to be powered by electricity. Now everyone is paying attention.

Smart man.

So how does this apply to you and your small business?

Aim for the top end of your market. Narrow your niche. Add value to your offerings. Become the premium product.. Talk to people who are looking for value, not the lowest prices.

I know what you're thinking because I get the same resistance from my clients when I suggest this. It seems counter intuitive. However, here's what I've seen time and again.

When you become the premium product in your market, you work less but make more. And finally, because demand trickles down, those cautious folks who wouldn't talk to you before will get their social proof.

Take a page from Elon Musk and his Tesla. Start at the top. Let the marketplace and the funny way we humans are wired work their magic for you.


Leave a comment


Please note, comments must be approved before they are published



Liquid error: Could not find asset snippets/sca-quick-view-template.liquid